Reviewing PDD (NASDAQ:PDD) and Envestnet (NYSE:ENV)

PDD (NASDAQ:PDD) and Envestnet (NYSE:ENV) are both multi-sector conglomerates companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, risk, dividends, analyst recommendations, institutional ownership and earnings.

Profitability

This table compares PDD and Envestnet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PDD	26.93%	45.04%	24.45%
Envestnet	-15.33%	14.75%	5.01%

Volatility and Risk

PDD has a beta of 0.64, suggesting that its stock price is 36% less volatile than the S&P 500. Comparatively, Envestnet has a beta of 1.28, suggesting that its stock price is 28% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and target prices for PDD and Envestnet, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PDD	0	0	9	0	3.00
Envestnet	0	3	5	0	2.63

PDD presently has a consensus target price of $188.33, suggesting a potential upside of 33.07%. Envestnet has a consensus target price of $64.14, suggesting a potential upside of 2.06%. Given PDD’s stronger consensus rating and higher probable upside, equities research analysts plainly believe PDD is more favorable than Envestnet.

Insider & Institutional Ownership

29.1% of PDD shares are held by institutional investors. 3.7% of PDD shares are held by insiders. Comparatively, 8.9% of Envestnet shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares PDD and Envestnet’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PDD	$34.88 billion	5.58	$8.45 billion	$7.55	18.75
Envestnet	$1.25 billion	2.78	-$238.72 million	($3.56)	-17.65

PDD has higher revenue and earnings than Envestnet. Envestnet is trading at a lower price-to-earnings ratio than PDD, indicating that it is currently the more affordable of the two stocks.

Summary

PDD beats Envestnet on 12 of the 14 factors compared between the two stocks.

About PDD

PDD Holdings Inc., a multinational commerce group, owns and operates a portfolio of businesses. It operates Pinduoduo, an e-commerce platform that offers products in various categories, including agricultural produce, apparel, shoes, bags, mother and childcare products, food and beverage, electronic appliances, furniture and household goods, cosmetics and other personal care, sports and fitness items and auto accessories; and Temu, an online marketplace. It focuses on bringing businesses and people into the digital economy. The company was formerly known as Pinduoduo Inc. and changed its name to PDD Holdings Inc. in February 2023. The company was incorporated in 2015 and is based in Dublin, Ireland.

About Envestnet

Envestnet, Inc., through its subsidiaries, provides wealth management software and services in the United States and internationally. It operates through two segments: Envestnet Wealth Solutions and Envestnet Data & Analytics. The Envestnet Wealth Solutions segment offers Envestnet | Enterprise, an end-to-end open architecture wealth management platform, as well as offers data aggregation and reporting, data analytics, and digital advice capabilities; Envestnet | Wealth Analytics that transforms data into actionable intelligence; Envestnet | Tamarac which provides trading, rebalancing, portfolio accounting, performance reporting, and client relationship management software; and Envestnet | MoneyGuide that provides goals-based financial planning solutions to the financial services industry. This segment also provides Envestnet | Workplace Solutions which offers a suite of services for advisor-sold retirement plans; Envestnet | PMC that offer research and consulting services to assist advisors in creating investment solutions, and portfolio overlay and tax optimization services; and Envestnet | Billing Solutions which provides revenue management and hosted fee-billing solutions. The Envestnet Data & Analytics segment provides Envestnet Data & Analytics, a data aggregation, analytics, and digital experiences platform that provides clients and their account holders with data connectivity via open APIs, data enrichment, AI-based analytics, and digital experiences. It serves retail banks, credit unions, credit card providers, wealth management financial advisors and institutions, financial technology innovators, financial advisory firms, research and analyst firms, personal financial management, small business accounting, e-commerce, payment solutions providers, small business lending, and authentication customers. The company was founded in 1999 and is headquartered in Berwyn, Pennsylvania.